In order to fix Nigeria’s housing deficit, operators in the real estate sector have said there is a need to tap opportunities such as retail housing/shortlets, warehousing and online real estate.
At BusinessDay’s annual Property Investment Conference (PRINVEST) 2023, themed ‘Ready Or Not To Invest,’ stakeholders said leveraging investment opportunities in unexplored segments is critical to plugging the housing deficit estimated at 28 million units.
They said the government should formulate strong regulatory policies, ensure strict adherence, educate investors, and encourage partnerships.
According to the Central Bank of Nigeria, more than 28 million Nigerians lack access to decent and affordable housing, and this is in tandem with the estimates of the Federal Mortgage Bank of Nigeria, which projects that Nigeria requires at least 28 million housing units to close the gap.
“Affordable housing is an untapped prospect in real estate,” said Christine Fashakin-Nobre, group chief operating officer of Brains and Hammers.
“A short-let apartment is another untapped resource that should be explored by a developer. Commercial and office space are also significant untapped resources that investors can consider as a second source of passive income,” she added.
Olubisi Shaola, CEO of Finn Grey Projects, said it is not the sole responsibility of the government to provide housing. “They only create an enabling environment for real estate to thrive.”
He said insecurity, political instability, and unemployment pose a threat to investors’ ability to explore the resources in the real sector.
“Everyone is seeing what’s happening in the country’s political landscape and fears to risk their money in bridging the gap between the government and the people in providing housing,” he said.
According to industry operators, the contribution of the sector to the nation’s Gross Domestic Product needs to be increased.
Despite the boom in Nigeria’s real estate sector, it was observed that real estate investment has not contributed enough to the GDP of the nation’s economy, said Toke Benson-Awoyinka, special adviser to the governor of Lagos State.
Some speakers at the event stressed the need for the government to regulate the activities of developers in the coastal areas.
“The government can make regulations – inspect engineering processes/mechanisms, promote urban building systems, and establish strong institutions,” said Lukman Shobowale, co-founder of Dukiya Investments Limited.
He said that people sand fill drainages and build on them. “We are sitting on gunpowder.”
He said that there are opportunities around the coastal regions, especially in terms of transportation.
“The government needs to explore waterways and create opportunities for people to commute within and outside the state,” he said.
Temperatures and sea levels are rising in Nigeria, with some low-lying coastal cities already experiencing devastating floods. According to reports, some cities are sinking due to increasing sea levels slowly encroaching on their coasts, while others are sinking because of excessive groundwater pumping.
Paul Erubami, president of Association of Facility Management Practitioners, Nigeria and CEO of Max-Migold, said building on coastal land is very risky. “It is like living in a house that is not liveable, but developers cash out and people live in fear in those buildings.”
He said: “We can’t expect the government to do everything. There is a need for sustainability, where professional bodies make sure that nobody can break the law, and we can have an enforcing body.
“It should be noted that we are sleepwalking into a well-known doom as we are developing around coastal areas. The planning for every development should be anchored on sustainability, not on short-term cash. There is a need to own the terrain as developers, realtors and other professional bodies.”
Some operators in the sector said a lot of shabby work goes into project developments around the coastline and that bears more risks than in inland regions.
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